Revaluation of fixed assets is necessary to bring their book value into line with fair market value. Let's see if this is necessary and find out what questions need to be answered in order to do it right.
According to the current rules, fixed assets are accounted for in the balance sheet at their original cost, which cannot change except in cases of change in the fixed asset itself: modernization or reconstruction, completion or additional equipment, partial liquidation. The only way to change the original cost without changing the asset itself is revaluation.
In general, the purpose of a revaluation is to ensure that the balance sheet reflects the fair market value of property, plant and equipment. Conducting a revaluation is a right, not an obligation of the organization. There are many reasons to exercise this right, namely:
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Since the value of non-current assets often reaches very large amounts, revaluation must be approached with full responsibility.
First of all it is necessary determine revaluation objectives and the composition of the assets subject to it.
Then issue an order for revaluation, in which to indicate specific types of property, structural units to which they belong and officials responsible for the safety of these objects and revaluation. The same order establishes the composition of the commission and the dates for the start and completion of the assessment procedure.
Based on the order a commission is created, which should include representatives of production departments, technical services, accounting, as well as external technical specialists and expert appraisers.
The commission, having established when and on what basis the object was put into operation, its location and the moment of assessment, conducts technical examination of the asset. As a result, the technical condition of the object and the degree of its compliance with the technical conditions established for this type of property must be determined.
The next stage is determining the fair (market) value of an asset, documents are collected justifying the new price, which are attached to the act.
All collected information, that is, the result of the revaluation of fixed assets, is presented in the form revaluation act, to which, in addition to the expert appraiser’s report and other evidence of the new value, is attached a list of technical documentation on the basis of which the condition of the object was assessed.
Then enter the appropriate entry in the registration card of this object, about which the accounting representative in the commission makes a note in the revaluation act. Upon completion of these procedures, the act is signed by all members of the commission and the chief accountant.
In the object registration card the carrying amount is adjusted to the revaluation amount, forming the replacement cost. After this, the accumulated depreciation charges are recalculated.
In addition to the reasons listed above for which it is worth revaluing, it is necessary to take into account other circumstances that are “on the other side of the scale” and may change the opinion about the advisability of revaluing wasps. All these circumstances are directly or indirectly a consequence of legislative requirements for accounting and taxes and fees.
The first circumstance is that once a decision has been made to revaluate an asset, it will need to be carried out regularly. The interval for the procedure is set by the organization itself so that the replacement cost continues to correspond to the market price, but cannot be less than one year.
Secondly, revaluation can only be carried out when fair value can be measured reliably.
Third, there should be no selective revaluation. That is, when revaluing an individual object, the value of all objects belonging to the same class of fixed assets, that is, having similar properties and nature of use, should be reconsidered. Ideally, the procedure should be done in one day, but if this is not possible, then one after another within a short period of time.
For example, if a company has production facilities in different regions, then a selective revaluation would mean changing the value of specific equipment (boiler, heating system, central air conditioning system, etc.) in all locations or revaluing all pieces of equipment, but only in one location. Such actions will lead to the fact that one part of homogeneous assets will be accounted for at replacement cost, and the other at original cost, and this is a gross violation of the principle of consistency.
The excess of the replacement cost of fixed assets over their original cost is taken into account in the subaccount “revaluation results” of the additional capital accounts. According to the requirements of PBU 6/01, only after the sale of a revalued object, additional capital is transferred to retained earnings. This means that until the disposal of this fixed asset, the profit from its revaluation is not distributed in the form of dividends.
There are important points to keep in mind when accounting for changes in value. The reduction in replacement cost relative to the original cost is charged to other expenses. An increase in replacement cost during further revaluations is included in other income, but only until it again equals the original value. Any further excess will be charged to additional capital.
If later the replacement value decreases again, this should be reflected as a decrease in additional capital, but only until the value after revaluation is equal to the original one. Further reductions must again be accounted for as other expenses.
The Tax Code recognizes the results of revaluation only for calculating property tax. For the calculation of VAT and income tax, only the original cost and the depreciation calculated based on it are important. Such differences lead to temporary differences in the calculation of income tax (see also legal ways to optimize income tax).
In addition to the technical condition, which is determined by the revaluation commission, the following factors are important to determine fair value:
The indexation method, that is, multiplying the book value of property by a certain coefficient (index), is used to obtain the current value of assets. For example, revaluation using this method was mandatory for enterprises of all forms of ownership in Russia as of January 1, 1994, and the indices were determined by a government decree issued the day before.
It consists of determining the current market price of the property by comparison with current offers for purchase and sale and information on transactions with similar objects in this region. If the available data allows for a representative sample, then the market value is averaged over all objects and transactions selected for comparison. Replacement cost is calculated from the obtained average market price, taking into account the remaining useful life. Despite the simplicity of this method, its use is not always possible, for example, if such data is not available for one reason or another
All fixed assets can be accounted for either at historical cost or using the revaluation method. Whether to carry it out or not, and if carried out, then for which groups of assets, the enterprise decides independently. It is most advisable to carry out regular revaluation of expensive objects with a long useful life. Property such as vehicles, furniture and equipment or office equipment, as a rule, is not overvalued.
Presenting fixed assets at their fair market value, on the one hand, provides more relevant information to the management and creditors of the organization, and on the other hand, the application of the revaluation model is more complex and expensive. In addition, it is not always possible to determine fair value with a sufficient degree of evidence, which makes it possible to manipulate accounting income.
Having switched to a revaluation model, it must continue to be carried out with sufficient regularity to ensure that the carrying amount does not differ significantly from the fair value at each reporting date.
The tax consequences of applying the revaluation of the principal are a change in the amount of income tax and the occurrence of
When changing the authorized capital, expanding a business, and in other cases, you need to know the market value of the property. The easiest way to determine the true price is by revaluation. What are the rules regarding asset revaluation in 2019?
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One of the main tasks of modern accounting is accounting for fixed assets. At the same time, their cost tends to change against the background of inflation and the market economy.
From an accounting point of view, the valuation should be considered comprehensively in relation to the recording of revaluation transactions. What is the procedure for revaluing fixed assets in 2019?
The organization has every right to revaluate the value of fixed assets. The main purpose of this procedure is to establish the true price of objects based on market prices and conditions for reproduction.
The company can independently decide whether to revaluate or not. But you need to remember that when revaluing, in the future it should be carried out regularly, no more than once a year.
Regular revaluation of fixed assets is carried out to establish their true value, that is, so that the value of the valued objects displayed in accounting does not differ significantly from the current value.
Revaluation is a procedure for clarifying the replacement cost of an object, the purpose of which is to bring the value to the current level of market prices.
The revaluation process consists of recalculating the original cost and the depreciation amount calculated for the period of application. The result of revaluation depends on whether the calculated amount is greater or less than the original price.
When the replacement cost turns out to be more than the residual (initial) value, then a markdown takes place. The replacement cost has exceeded the residual value - there is an overvaluation.
The results of the revaluation are not included in the financial statements of the previous year. The obtained indicators are used exclusively when creating at the beginning of a new reporting period.
But the term “revaluation of the value of fixed assets” is not as clear as it seems. This is due to different definitions of the concept in different standards.
Now an entity can develop revaluation indices independently, guided by information about the inflation level in the region of presence, or order paid development from the State Statistics Committee.
As a rule, the indexation method is more difficult to implement; therefore, the revaluation of a fixed asset item is often carried out by recalculation.
The amount of depreciation or revaluation of an object is found by calculating the original cost from the replacement value established based on the results of the revaluation.
In international accounting, revaluation of fixed assets is regulated. According to these standards, revaluation is carried out at fair value.
This is determined based on market data. That is, the calculation at replacement cost in PBU is a variant of revaluation according to IFRS.
The decision to reassess the assets must be enshrined in the relevant order of the manager.
This document contains the following information:
Guided by the order, the accountant prepares a list of objects that must be revalued and first checks their availability.
The list contains information on each object of the specified OS group, namely:
An economic entity has the right to revaluate its fixed assets no more than once a year, at the end of the reporting period, that is, on December thirty-first.
The exact date of revaluation is determined by the date of formation of the annual balance sheet. This is due to the fact that the results of the revaluation are included in the financial statements.
The annual balance sheet must be approved no later than six months after the end of the reporting year for a JSC and no later than four months for an LLC.
Thus, the period for revaluation is the period from December thirty-first of the reporting year to the date of approval of the balance sheet.
Having assessed a group of similar fixed assets once, the enterprise must carry out revaluation regularly. But it is not legally established what exactly is meant by regularity.
Therefore, it is possible to consolidate the revaluation annually, every two or three years or more years, but not more than one evaluation per year.
The organization must strictly observe the approved frequency of revaluation.
That is, if the last revaluation was carried out for a certain group of objects, then after a time specified in the accounting policy it is necessary to revaluate these fixed assets again. Tax and administrative liability is provided for irregular revaluation.
Based on the results of revaluation, the object is discounted or revalued. At the same time, revaluation increases personal capital, the size of net assets and the tax base for. Markdown—reduces these values.
Revaluation of fixed assets is considered beneficial to the enterprise when:
But when applied, the subject will have to pay a large amount of property taxes upon revaluation. Conversely, tax payments to the budget decrease when markdowns occur.
The results of the revaluation of fixed assets should be reflected in accounting. Accounting entries vary depending on the depreciation or revaluation, as well as on how many times the object was evaluated.
When devaluing objects, the following types of accounting entries are used:
| Dt84 Kt01 | Total value of fixed asset markdown during initial revaluation |
| Dt02 Kt 84 | Adjusted depreciation volume |
| Dt83/1 Kt01 | The amount of fixed asset markdown during repeated and subsequent revaluation is the same as the previous revaluation |
| Dt02 Kt83 | Adjustment of depreciation during secondary revaluation |
| Dt84 Kt01 | Excess of markdown over previous revaluation |
| Dt02 Kt84 | Adjustment of depreciation charges when the depreciation exceeds the previous revaluation |
Adjustment of depreciation calculated at the time of revaluation is carried out on the basis of a special coefficient:
In this case, the total volume of adjusted depreciation is calculated as:
To display the additional valuation of fixed assets in accounting, the following transactions are used:
Revaluation of fixed assets has a positive effect on the size of net assets. However, this effect is short-term.
In the long term, net asset indicators improve only due to improved financial performance of the enterprise.
Attention!
If a company has decided to expand its business and take out a loan, increase its authorized capital, or prepare the enterprise for sale and purchase, it is necessary to know the market value of the property. The surest way to find out the “true price” of fixed assets is to revaluate them. At the same time, it must be carried out taking into account the new rules.
Organizations can revaluate fixed assets (clause 15 of PBU 6/01 “Accounting for fixed assets”, approved by order of the Ministry of Finance of Russia dated March 30, 2001 No. 26n; hereinafter referred to as PBU 6/01). The main goal of this event is to determine the real value of fixed assets in accordance with their market prices and reproduction conditions on the date of revaluation.
It is up to the company to decide whether to revalue the property or not. However, it is worth remembering: if a company has revalued its assets once, then in the future it should be carried out regularly, but not more than once a year. This condition is necessary to ensure that the cost of these fixed assets, at which they are reflected in accounting and reporting, does not differ significantly from the current (replacement) cost. The concept of materiality is given in paragraph 44 of the “Methodological instructions on accounting for fixed assets” (approved by order of the Ministry of Finance of Russia dated October 13, 2010 No. 91n, hereinafter referred to as Instructions No. 91n) and discussed with an example. Let's bring him.
Example 1
Albatross LLC decided to revaluate fixed assets. The cost of fixed assets at the end of the previous reporting year amounted to 1,000,000 rubles. The current (replacement) cost of objects of this homogeneous group at the end of the reporting year is 1,100,000 rubles. The resulting difference is considered significant: (1,100,000 - 1,000,000) / 1,000,000 = 0.1.
Let's consider the same example, provided that the current (replacement) cost is 1,030,000 rubles. In this case, the decision on revaluation is not made, since the difference that arises is not significant: (1,030,000 - 1,000,000) : 1,000,000 = 0.03.
However, from these calculations it is not entirely clear why a deviation of 10 percent is considered significant, but a deviation of 3 percent is not. Probably, the legislator implies a 5 percent materiality barrier, mentioned in the Instructions on the procedure for drawing up and presenting financial statements (approved by order of the Ministry of Finance of Russia dated July 22, 2003 No. 67n, as amended by orders of the Ministry of Finance of Russia dated December 31, 2004 No. 135n, dated September 18, 2006 No. 115n).
Preparatory work before revaluation
In order to carry out a revaluation, the organization must carry out preparatory work - for example, check the presence of the fixed assets themselves that are subject to revaluation.
The decision to conduct a revaluation is formalized in the appropriate administrative document. Its use is mandatory for all services of an economic entity that will be involved in the revaluation.
Revaluation is carried out at current (replacement) cost by indexation or direct recalculation at confirmed market prices.
In order to determine the current (replacement) cost, you must use:
From January 1, 2011, by order of the Ministry of Finance of Russia dated December 24, 2010 No. 186n, changes were made to paragraph 49 of the Regulations on accounting and financial reporting in the Russian Federation (approved by order of the Ministry of Finance of Russia dated July 29, 1998 No. 34n), paragraphs 43 - 47 Instructions No. 91n. According to these innovations, revaluation of fixed assets should be carried out no more than once a year and at the end of the reporting period. Previously, it had to be carried out at the beginning of the reporting period (clause 49 of the “Regulations on accounting and reporting in the Russian Federation”, approved by order of the Ministry of Finance of Russia dated July 29, 1998 No. 34n).
Accounting for revaluation
When revaluing fixed assets, their original value is recalculated, and if these objects were revalued earlier, their current (replacement) value at which they are recorded in accounting as of the date of revaluation. The amount of depreciation accrued for the entire period of use of the object is also subject to revaluation.
Note that during revaluation, the original cost may change either upward (revaluation) or downward (discount). It all depends on whether this object was overvalued before or not. As a result, the reflection of such revaluation in accounting will also be different.
If the object has not been revalued before, then:
If the revaluation of fixed assets has already been carried out previously, then these operations will be reflected differently in accounting. Let's depict this in the form of a table.
Table 1
| When carrying out an additional assessment | When conducting a markdown |
||
| If the item was previously discounted | If the object was previously overvalued | If the item was previously discounted | |
The amount of the new revaluation is credited to additional capital (account 83) | The amount of the revaluation, equal to the amount of the depreciation carried out in previous reporting periods, is credited to the account for other income and expenses (account 91). If the amount of the revaluation exceeds the amount of the depreciation (account 91), then the excess amount is credited to the additional capital account (account 83) | The amount of the markdown is included in the reduction of additional capital formed from the amounts of the additional valuation of this object carried out in previous reporting periods (account 83). If the amount of the depreciation exceeds the amount of the revaluation credited to additional capital, then such excess is charged to the financial result as other expenses (account 91) | The amount of the new markdown is credited to the account of other income and expenses (account 91) |
As we can see from the table, the revaluation of fixed assets is reflected differently in accounting. Let's look at some cases using examples.
Example 2
As of December 31, 2011, by decision of the head of the organization, a revaluation of fixed assets was carried out. According to accounting data before revaluation:
initial cost of the OS - 500,000 rubles;
the amount of depreciation accrued on it is 100,000 rubles.
450 000: 500 000 = 0,9.
100,000 * 0.9 = 90,000 rub.
Depreciation amount:
500,000 - 450,000 = 50,000 rubles.
Amount of discounted depreciation:
100,000 - 90,000 = 10,000 rubles.
In accounting, these transactions will be reflected as follows:
Debit 91.2 Credit 01
- 50,000 rub. - reflects the amount of depreciation of the initial cost of the fixed asset;
Debit 02 Credit 91.1
- 10,000 rub. - previously accrued depreciation was reduced.
Let's consider more complex accounting cases when an item of fixed assets, for example, was subject to a discount, and was subsequently revalued.
Example 3
Silver LLC, by decision of the head of the organization, revalued fixed assets at the beginning of 2011.
According to accounting data, the data on fixed assets were as follows:
initial cost - 400,000 rubles;
current value - 350,000 rubles;
depreciation - 80,000 rubles;
useful life of the OS is 10 years;
depreciation is calculated using the straight-line method.
350 000: 400 000 = 0,875.
The amount of recalculated depreciation will be:
80,000 * 0.875 = 70,000 rub.
Depreciation markdown:
80,000 - 70,000 = 10,000 rubles.
Depreciation of fixed assets:
400,000 - 350,000 = 50,000 rubles.
The total markdown amount will be:
50,000 - 10,000 = 40,000 rubles.
The initial data can be presented as follows:
OS cost—RUB 350,000;
current value - 450,000 rubles;
depreciation for the year amounted to 40,000 rubles.
The amount of depreciation was:
70,000 + 40,000 = 110,000 rub.
Let's calculate the revaluation ratio of fixed assets:
450 000:350 000 = 1,3.
Amount of recalculated depreciation:
1.3 * 110,000 = 143,000 rubles;
Amount of revaluation of fixed assets:
450,000 - 350,000 = 100,000 rubles.
Amount of revaluation of depreciation:
143,000 - 110,000 = 33,000 rubles.
Total amount of revaluation:
100,000 - 33,000 = 67,000 rubles.
Note:
At the beginning of the year, the amount of the markdown in accounting is reflected according to the old rules, namely in account 84 “Retained earnings (uncovered loss)” and has the following form:
Debit 84 Credit 01
- 50,000 rub. - the amount of the initial revaluation of the value of the fixed asset;
Debit 02 Credit 84
- 10,000 rub. - the amount of depreciation markdown.
However, at the end of the year the following rules apply: the amount of revaluation of a fixed asset in an amount equal to the previous markdown is credited to the account for other income and expenses (account 91). And the excess amount is credited to the additional capital account. Let's reflect this in accounting like this:
Debit 01 Credit 91.1
- 50,000 rub. - additional assessment of the cost of fixed assets within the limits of the previous markdown amounts;
Debit 91.2 Credit 02
- 10,000 rub. - additional assessment of depreciation within the limits of the markdown;
Debit 01 Credit 83
- 50,000 rub. (100,000 -50,000) - additional assessment of replacement cost
in excess of the amount of the previous markdown;
Debit 83 Credit 02
- 23,000 rub. (33,000 - 10,000) - additional assessment of depreciation in excess of the amount of the previous markdown.
Let us depict in the form of a table the operations associated with revaluation.
table 2
| Contents of operation | Debit | Credit |
| In case of revaluation (if there was no previous depreciation) | ||
| Reflected revaluation of initial cost | 01 "Fixed assets" | 83 “Additional capital” |
| Increased accrued depreciation on fixed assets | 83 “Additional capital” | 02 “Depreciation of fixed assets” |
| In case of markdown (if revaluation has not been carried out previously) | ||
| Reflected markdown of original cost | 91.2 “Other expenses” | 01 "Fixed assets" |
| Accrued depreciation has been reduced | 02 “Depreciation of fixed assets” | 91.1 “Other income” |
| In case of revaluation (if a depreciation was previously carried out) | ||
| The additional valuation of fixed assets is reflected in an amount equal to the previously carried out markdown | 01 "Fixed assets" | 91.1 “Other income” |
| The additional assessment of depreciation is reflected within the limits of the previously carried out markdown | 91.2 “Other expenses” | 02 “Depreciation of fixed assets” |
| Additional assessment of replacement cost above the amount of the previous markdown | 01 "Fixed assets" | 83 “Additional capital” |
| Additional assessment of depreciation in excess of the amounts of the previous markdown | 83 “Additional capital” | 02 “Depreciation of fixed assets” |
| In case of markdown (if there was previously an increase in valuation) | ||
| The reduction in replacement cost is reflected within the amount of the previous revaluation | 83 “Additional capital” | 01 "Fixed assets" |
| Markdown of depreciation within the limits of previously carried out revaluation | 02 “Depreciation of fixed assets” | 83 “Additional capital” |
| Markdown of replacement cost in terms of excess of the previous revaluation | 91.2 “Other expenses” | 01 "Fixed assets" |
| Markdown of depreciation within the limits of the previous revaluation amounts | 02 “Depreciation of fixed assets” | 91.1 “Other income” |
However, the opposite case to the above is possible. That is, a markdown is being carried out, but a revaluation was previously carried out.
Example 4
Albatross LLC revalued its fixed asset at the beginning of the year. It was underrated. We present the initial data for such an object as follows:
initial cost - 200,000 rubles;
current value - 250,000 rubles;
accrued depreciation - 40,000 rubles.
The useful life of the asset is 10 years, depreciation is calculated using the straight-line method.
Let's calculate the revaluation coefficient:
250 000: 200 000 = 1,25.
Amount of recalculated depreciation:
40,000 * 1.25 = 50,000 rub.
The amount of excess depreciation will be as follows:
50,000 - 40,000 = 10,000 rubles.
Amount of revaluation of fixed assets:
250,000 - 200,000 = 50,000 rubles.
The total amount of the revaluation will be:
50,000 - 10,000 = 40,000 rubles.
At the end of 2011 (December 31, 2011), the fixed asset was revalued in the form of a markdown. Let's present data on the facility at the end of 2011:
depreciation accrued for the year - 20,000 rubles.
the cost of the fixed asset is 250,000 rubles.
current cost - 150,000 rubles.
Let's calculate the revaluation coefficient:
150 000:250 0000 = 0,6.
Accumulated depreciation amount:
40,000 + 20,000 = 60,000 rub.
Let's recalculate depreciation:
60,000 * 0.6 = 36,000 rub.
The markdown amount will be:
250,000 - 150,000 = 100,000 rubles.
Total markdown amount:
100,000 - 36,000 = 64,000 rubles.
At the beginning of the year, operations to revaluate a fixed asset will be reflected in accounting as follows:
Debit 01 Credit 83
- 50,000 rub. - OS is underestimated;
Debit 83 Credit 02
- 10,000 rub. - additional assessment of depreciation for fixed assets.
At the end of 2011, as we remember, the fixed asset was discounted. In this case, the following rules for reflecting revaluation in accounting will apply, namely: the amount of revaluation equal to the amount of its depreciation carried out in previous reporting periods is credited to the accounts of other income and expenses (account 91). If the additional valuation exceeds the amount of the previous markdown, then this amount must be charged to account 83 “Additional capital”.
Let us reflect the results of the above example in the form of the following transactions:
Debit 83 Credit 01
- 50,000 rub. - write-down of fixed assets within the limits of the revaluation amounts;
Debit 02 Credit 83
- 10,000 rub. - markdown of depreciation within the limits of the revaluation;
Debit 91.2 Credit 01
- 50,000 rub. (100,000 - 50,000) - markdown of the current value of fixed assets in terms of excess over the previously carried out revaluation;
Debit 02 Credit 91.1
- 26,000 rub. (36,000 - 10,000) - markdown of fixed assets depreciation within the limits of the previously carried out revaluation.
Tax accounting
Please note that the results of revaluations carried out by an organization in accounting are not reflected in the tax authorities, since the Tax Code stipulates that when a taxpayer revaluates (discounted) the value of fixed assets to market value, the positive or negative amount of such revaluation (discounted) ) is not recognized as income (expense) taken into account for tax purposes. The Ministry of Finance of Russia adheres to a similar position in letters dated July 8, 2011 No. 03-03-06/1/412, dated September 8, 2011 No. 03-03-06/1/544.
Thus, the results of the revaluation of the value of fixed assets are reflected in accounting, but for profit tax purposes the results of the revaluation are not taken into account.
Special rules
The Tax Code stipulates that the initial cost of fixed assets can be changed only in cases of completion, additional equipment, reconstruction, modernization, technical re-equipment, partial liquidation and on other similar grounds (clause 2 of Article 257 of the Tax Code of the Russian Federation). The said article does not say anything about revaluation.
Yu.L. Ternovka, expert editor
Instructions
First, it should be clarified that the revaluation of fixed assets must be carried out once a year before the reporting period (before January 1). The revaluation must be prescribed in the accounting policies of the organization.
Determine which group of fixed assets you will revaluate, that is, you can revaluate buildings without affecting transport. But if you are evaluating, for example, equipment, then you must take into account all homogeneous assets, even if they are located in a different warehouse and are listed in a different division.
Issue an order for the revaluation of homogeneous groups of fixed assets, also indicate in this administrative document the date of this procedure, list all fixed assets, the date of acquisition and commissioning of the property. Also in this order indicate the responsible persons who are involved in the assessment of the property.
Then use the direct revaluation method to revaluate. That is, check the market value of these assets, with the help of an independent appraiser, or by checking the data with the manufacturer, or with statistical authorities, you can also use special literature.
Fill out the revaluation data in a special free form. Be sure to indicate in this document the name of the main asset, the date of revaluation, the procedure for calculating the estimated value, new information on these assets, and the amount of decrease (increase) in value.
Then, based on the statement, draw up an accounting statement, which also indicates the procedure for calculating the residual value, further actions (decreasing or increasing the value of the property and depreciation accrued on it).
After this, reflect the results of the assessment in accounting. If the value of assets has decreased, that is, a markdown has occurred, reflect this as follows:
D84 “Retained earnings (uncovered loss)” or 83 “Additional capital” K01 “Fixed assets” - the initial cost of fixed assets was reduced;
D02 “Depreciation of fixed assets” K84 “Retained earnings (uncovered loss)” or 83 “Additional capital” - the amount of depreciation charges has been reduced.
If the value of fixed assets increases (revaluation), reflect this as follows:
D01 “Fixed assets” K83 “Additional capital” or 84 “Retained earnings (uncovered loss)” - the initial cost of fixed assets has been increased;
D83 “Additional capital” or 84 “Retained earnings (uncovered loss)” K02 “Depreciation of fixed assets” - the amount of depreciation charges has been increased.
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Helpful advice
Please note that if you revaluate fixed assets once, you must do it regularly once a year.
Fixed assets are the assets of an enterprise whose useful life is more than a year. These include property such as buildings, structures, transport, etc. In accounting and tax accounting, fixed assets are reflected in account 01. As a rule, depreciation (wear and tear) is calculated monthly, with the help of which the initial amount is gradually written off. Some organizations revaluate assets, that is, they clarify the replacement cost in order to equate it to the level of market prices.
You will need
Instructions
Form a commission that will carry out this procedure. You, as a leader, must certainly be part of this team. The chief accountant is also an obligatory person. Also record this information in your accounting policies.
Before revaluation, make an inventory, that is, check the actual availability of assets in the organization and what is reflected in the accounting. To carry out this procedure, also appoint an inventory commission. Before doing this, be sure to take a receipt from the financially responsible person stating that all documentation has been submitted to the accounting department.
After completing the inventory, issue an order for the revaluation of fixed assets, where you list the composition of the commission, the name of the revalued assets, and the period of the procedure.
Then, together with the members of the commission, inspect the assets, record their technical condition in a statement, the form of which is arbitrary. In this document, indicate the name of the assets, inventory numbers, dates of all transactions reflecting the movement of the fixed assets. Also record the original cost and the amount of depreciation. At the end, put the amount received after revaluation.
After this, submit the statement to the accounting department, which will make the appropriate entries.
In case of revaluation:
D01 K83, 84 (the initial cost of the operating system has been increased);
- D83, 84 K02 (the amount of depreciation charges has been reduced).
In case of markdown:
D84.83 K01 (the initial cost of the operating system has been reduced);
- D02 K83, 84 (the amount of depreciation charges has been increased).
When carrying out activities, some heads of organizations use fixed assets. These assets include buildings, machinery, equipment and more. In accounting, transactions performed with property should be reflected in account 01.
Fixed assets are assets that have a useful life of more than a year. They are not intended for resale and have a tangible form, that is, they can be seen and touched.
Fixed assets are classified into production and non-production. The first group includes machines, equipment (machines, for example), and buildings. The second group includes those assets that do not take part in production; this can include kindergartens, clinics, etc.
There are also active and passive agents. Active ones are directly involved in production, this includes machines and equipment. Buildings can be classified as passive.
Property can come to the organization from various sources, for example, from the founders, as a result of purchase, under a gratuitous agreement, etc. Commissioning must be carried out on the basis of an order from the manager. After signing it, the accountant draws up an act of acceptance and transfer of the asset (form No. OS-1, form No. OS-1a or form No. OS-1b).
Also, an inventory card must be created for the fixed asset (form No. OS-6, form No. OS-6a or form No. OS-6b) and assigned an inventory number.
In accounting, commissioning should be reflected as follows:
If the property is received from the founders:
D75.1 K80 – reflects the debt of the founders on deposits;
D08 K75.1 – assets were received as a contribution to the management company;
D01 K08 – assets put into operation.
If the property is purchased from suppliers:
D08 K60 – funds were paid to the supplier for fixed assets;
D08 K76 (60.23) – reflects the amount of expenses for the delivery of fixed assets;
D01 K08 – fixed asset put into operation.
Tangible assets must be valued. You can do this in several ways:
At original cost;
By residual value;
At replacement cost.
The original cost is the price you paid when purchasing the product (minus VAT). If the asset was manufactured by you, this cost includes costs incurred during the manufacturing process. If the fixed asset was transferred to you under a gift agreement, the value is determined based on market prices.
Residual value is defined as the difference between the original cost and depreciation accrued during use.
Replacement cost is the value that is determined through the revaluation process, meaning you must value the assets according to their current market value.
If you increase the value of an asset, make the following entries:
If you write down the value of an asset, record it as follows:
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Revaluation of fixed assets is carried out no more than once a year. In accounting and tax accounting, the results of revaluation are reflected differently.
Revaluation of fixed assets is a change in book value due to a change in market value. Revaluation of fixed assets is carried out in order to establish their correct book value at the current moment, to bring the book value closer to the market value.
Based on the results of revaluation, fixed assets can be overvalued, that is, the cost of the object and accrued depreciation can be increased. Another option is to discount the object, then the original cost and depreciation are reduced.
Revaluation is a company's right, not an obligation. An organization may not revaluate at all if it indicates this in its accounting policy. But first, decide whether revaluation will be beneficial or not.
The cost of fixed assets affects the amount of net assets, the indicator of equity capital in the organization, as well as the tax base for property tax (clause 1 of Article 375 of the Tax Code).
Therefore, revaluation is necessary, for example:
If you transfer corporate property tax from the book value of an object, then it will be profitable to discount the object in order to pay less taxes.
Commercial organizations have the right to revaluate fixed assets no more than once a year (clause 15 of PBU 6/01 “Accounting for fixed assets”). The frequency is indicated in the accounting policy. The company may not revaluate all fixed assets at once, but rather by groups of homogeneous objects. For example, revaluate only vehicles or real estate.
The procedure for revaluing fixed assets is as follows. First, determine the current or replacement cost of the fixed asset. It is equal to the market value of the property, that is, the amount that the organization would spend to purchase exactly the same object now. To find out the market value of a property, contact an appraisal company or determine the price yourself based on data on similar properties.
Secondly, issue an order from the manager. It must indicate how you plan to revalue the objects and on what basis.
Thirdly, based on the results of the revaluation, draw up a document indicating the new initial cost and recalculated depreciation (clause 15 of PBU 6/01). If only one object has been revalued, issue an accounting certificate. If there are several, it is convenient to draw up an act based on the results of the revaluation. Develop the form of the statement yourself. Take this sample as a basis.
Fourthly, enter the inventory results in section 3 of the object’s inventory card.
Fifth, record the revaluation of fixed assets. Postings for the revaluation of fixed assets depend on the result: revaluation or depreciation of fixed assets.
The reflection of the revaluation depends on whether the organization calculates the replacement cost for the first time or not. The amount of the first revaluation must be reflected using account 83. Make an entry to the credit of account 83 “Additional capital”:
DEBIT 01 CREDIT 83
Additional assessment is taken into account;
DEBIT 83 CREDIT 02
Additional depreciation has been added.
If you previously discounted a fixed asset, then make an entry to the credit of account 83 only for the amount exceeding the loss from the previous revaluation. And for the amount of the previous loss, make an entry to the credit of account 91:
DEBIT 01 CREDIT 91 “Other income”
The initial cost of the fixed asset was overestimated by the amount of loss from the previous markdown;
DEBIT 91 subaccount “Other expenses” CREDIT 02
Additional depreciation has been added;
DEBIT 01 CREDIT 83
The initial cost of the fixed asset was overestimated by an amount exceeding the loss from the previous revaluation;
DEBIT 83 CREDIT 02
Additional depreciation has been added.
The postings depend on whether this is the initial stage of revaluation or not. Reflect the first markdown in the debit of account 91 subaccount “Other expenses”:
The original cost of the fixed asset has been discounted;
Depreciation has been reduced.
If the fixed asset was previously overvalued, reflect in other expenses only the amount of the markdown that exceeds the amount of additional capital formed during previous revaluations. The wiring is like this:
Debit 83 Credit 01
The initial (replacement) cost of a fixed asset has been reduced within the limits of additional capital formed during previous additional valuations of this object;
Debit 02 Credit 83 subaccount “Revaluation of fixed assets”
Accrued depreciation on fixed assets was reduced within the limits of additional capital formed during previous additional valuations of this object;
DEBIT 91 subaccount “Other expenses” CREDIT 01
The initial cost of the fixed asset was discounted by an amount exceeding the additional capital formed during previous revaluations;
DEBIT 02 CREDIT 91 subaccount “Other income”
Depreciation was reduced by an amount exceeding the additional capital formed during previous revaluations.
In tax accounting income tax, as well as in the tax database according to the simplified tax system the results of the revaluation are not taken into account (clause 1 of Article 257 of the Tax Code and letter of the Ministry of Finance of Russia dated September 10, 2015 No. 03-03-06/4/52221). Tax depreciation for calculating income tax is calculated based on the previous initial cost (letter of the Federal Tax Service of Russia dated December 23, 2016 No. SD-4-3/24772@).
When calculating corporate property tax From the book value, tax at the new value is calculated from the year on December 31 of which the results of the revaluation were reflected. If you calculate property tax based on the cadastral value of real estate, do not take into account the results of the revaluation.
A change in the book value of a plot does not affect the calculation of land tax, since land tax is calculated based on the cadastral value of the plot (subclause 1, clause 4, article 374 and clause 1, article 390 of the Tax Code).
